Today?s post is by Ashley Riviello , Account Manager at SafeSourcing Inc.
Only being with Safe Sourcing for a few days and knowing absolutely nothing about the company prior to my hire, I have learned a great deal of information in a very short amount of time. In order to fully understand what it is we do I have been doing a little research out side of work. According to sources, no pun intended, there are 7 steps of strategic procurement process.
Step 1: Conducting an internal need of analysis
To start you need to identify exactly what the needs are of your client. You need data including but not limited to, current performance, resources used, costs and potential growth.
Step 2: Collect Information
It is extremely important for you to collect as much information as possible, so you are able to help your client as best as possible. Look for specific requirements that are needed and see exactly what their goal is and how you can help them achieve that goal.
Step 3: Collect Supplier Information
Not only do you need information from your client, you also need to get information form your suppliers. You need to select suppliers carefully. You should only pick certain suppliers that are going to benefit your clients needs. It would also be helpful to learn a little bit about their company.
Step 4: Develop a Sourcing/Outsourcing Strategy
After all, 3 steps are complete you are in need of your Request for Proposal (RFP) or a Request for Quote (RFQ) to all the selected suppliers. You will also need to get your agreement and documents finalized and sent to your suppliers. Getting your business strategy in order will keep you organized.
Step 5: Implement the Sourcing Strategy
Having an Expression of Interest (EOI), a prepared RFP or a RFQ and solicit bids from identified potential suppliers as part of the bidding process is very important at this stage. The RFP should include:
- Detailed material
- Product or service specifications
- Delivery and service requirements
- Evaluation criteria
- Pricing structure
- Financial terms
Step 6: Negotiate with Suppliers and Select Winning Bid
Your procurement team will then evaluate the received proposals, quotes or bids, and use the criteria and a process to shortlist the bidders to provide detailed proposals and give reports to your client. After the evaluation process is complete, your procurement team will then enter contract negotiations with the first selected bidder.
Step 7: Implement a Transition Plan
Winning suppliers should be invited to participate in implementing improvements. A communication plan is a must when developing a system for measuring and evaluating performance.
These are a few things I have learned in the few days working for this great company and I feel that if you follow these few steps you and your team can develop and implement a strategic procurement plan.
We look forward to your comments